EB Daily Market Report - Friday, January 10, 2025

Dear Members.

A much better than expected jobs report this morning caught traders off guard while fueling inflation fears and "higher than longer" interest rate expectations. Thus, all of the major indexes are substantially lower.

On the one hand, you would think traders would applaud a strong economy. On the other hand, those expectations that the Fed would continue to lower rates have mostly disappeared, with the yield on the 10 year treasury bond marching towards that psychological level of 5%.

The selling today has definitely resulted in some technical damage with all of the major indexes below their respective 20 and 50 day moving averages. On the positive side, the market has come off session lows. But short of a strong close today the bears will enter next week with the upper hand.

Next week earnings season will kick into high gear with major banks set to report followed by thousands of companies over the next several weeks. And truth be told, when everything is said and done, nothing is more important to traders than earnings, so we'll soon find out if the numbers favor the bulls or the bears.

At your service,

John Hopkins